Nullifying Sovereign Debt

Subject: Highly explosive informationDate: Fri, 27 May 2011 16:47:06 +0200To: Chairman of the House of Representatives of the Netherlands

Dear Ineke Dezentjé Hamming,

Our letter will explain in 10 minutes why we should stop subsidizing countries in crisis and why interventions are necessary with the Dutch pension funds. We draw your attention to the possibility of nullifying our national debt through a new banking system. We hope that you and your party continue to support society. Society is not aware of the serious problems with, for example, our pension funds. In our letter we cover the following:

We hope you can call upon everybody to cooperate in this matter. That everyone will speak and act with one voice without fixation on their own party interests. It is your aim to serve society. We support you in that effort by sharing this letter on the Internet and with those people, like yourself, who really care for society.

With warm regards,B of Joy

We can solve the European sovereign debt!

The financial and monetary system is an unaffordable bottomless pitThe European Central Bank and the Major Banks create money out of thin air and make government and society pay dearly. The current banking system stimulates usury, ponzi schemes, corruption and shortages. This must change! The Netherlands can resolve the national debt and make society, the economy and pension funds healthy again. There is a new pure banking system ready to do this for all for us. Like Iceland: ‘stop wasting energy and capital’. European society isn’t helped by this, on the contrary!

Discussion about the Dutch state’s financial aid to GreeceIn the Dutch debate about additional aid to Greece, we notice an unnecessary disagreement in the Cabinet and parliament. With some of those involved we perceive unawareness, ignorance and inaccuracy. We advise the Cabinet, the Senate and the Members of Parliament to stand together and study the causes and effects objectively. The severity of the national debts has grown to such an extent that all political parties should, for the sake of Europe and the country, put their political differences aside and act for the benefit of society. This should appeal to any person who serves society.

The real causes as the problems are not tackledAdditional aid to Greece is, for several reasons, not a good idea. Also aid for Portugal, Spain, Ireland, Italy and other countries, should be strongly discouraged. If the current policy is continued, the Netherlands will certainly get into more trouble. As of 2013, our pension funds will also be used to pay for the debt of countries in crisis. Softening the symptomatic financial pain does not alleviate the real causes. At the same time it deprives those involved of the opportunity to take the necessary action. Only Iceland has got their act together and solved the problems.

The real causes of the financial crisisThe origins of the financial crisis in Greece and elsewhere is mainly due to the global financial and monetary system, which is completely based on debt. The man made concepts of interest and fractional banking are the main causes, completely unsustainable and should be abolished. See 'Why' for further explanation. The current system only enriches those who already have a lot of money. The current system also maintains a stranglehold on governments. That is why many government institutions keep supporting those who caused the financial crisis and filling a bottomless pit of debt.

A new value-system as a solution beside the euroWe recommend each EU country has a critical look at the real causes of their national debts. And to consider the concept of introducing a local currency such as the URA, next to the euro, on a national level. The successful introduction of a local currency is already being done. We've developed the local currency system further, so it can be of maximal benefit to government and society at large. The URA will stimulate the economy. Moreover, the URA is exchangeable with the euro, so that the international market will remain accessible. The SME’s (Small and Medium Enterprises) as core-generator of all economies, will again have sufficient URA suppliers and bank-credit at its disposal, so that innovation, employment and the national income will grow again. National debts can also be resolved by combing existing and new economic investment and trade models. Take note: as a society we have the right to issue the URA.

Never allow banks and governments to create your moneyThe creation of money can occur on the basis of production instead of debt. This is possible within a national cooperative, fully controlled and owned by society at large. Money will be issued interest -free. In addition, laws can be changed so that private banks are not allowed to create money anymore. The at the present time state-owned ABN-AMRO can function as a simple bank. A bank taking care of the payment transactions, attracts savings and makes interest-free loans. All salaries within the government are paid into the National Bank. Also, all town councils and other government agencies will be obliged to keep their funds at this bank. The guarantees for savers only apply at this National Bank. The installment of this bank falls into the category of immunization of the problems and risks, caused by the banks at present (gambling institutions). The private banks may work with shares and other investments as much as they like. If you wish, we can give you more precise information about the whole package and the inexhaustible possibilities of the new banking URA currency-system.

The Greek national debt and trade deficit as an exampleThe combination of an annual trade deficit, government budget deficit and a large national debt in Greece makes it clear that it’s almost impossible for Greece to ever pay off its debts. Just bringing the level of debt back to where we are in the Netherlands means many decades of austerity for the Greek citizens.

The only way to clear the Greek debt

It’s impossible for Greece to pay for the import of oil, cars, aircraft, computers and many other goods with the export of olive oil and tourism. And then there’s the high interest rates that raise the (cost) prices and damages social cohesion and any labor moral. When the Greek government cuts back on everything, domestic spending goes down and the government receives less tax revenue. That’s a ‘fine’ cocktail of bad management.

A good solution would be if Greece, from its own cultural preposition, could follow the example of Iceland and remove itself from the ruling thought system. Iceland has, through a referendum, decided not to make its citizens pay for the ethically objectionable behavior of a few bankers that just want to make money from money. They are simply went administratively bankrupt and have made those responsible, the banks, actually carry the cost. This should at least get governments to think about a structural solution.

The transition to a different financial system is necessary, but it does demand a new consciousness and great political courage. Back to a situation where only governments can create money. With an additional ban on charging interest, it’s the only way we have to sort out the debt problems. Any other solution that we implement within the current system only make the debt problem worse. That is not what is needed. The argument that everybody has profited from the system and therefore everybody should pay is absolutely untrue.

To start with, only 10% of the people profit from the creation of debt. In addition the citizens have no direct say about whether or not debt should be created and if so, to what end. Another side-effect is that SME’s over almost the whole world have a shortage of working capital which is mostly generated from bank credit but which is hardly being given out by the banking sector itself. Banks would rather ‘invest’ our money in risky projects that, on paper, seem to promise large returns in the short term. The SME’s, that are deemed to be ‘risky’ by banks, are under enormous pressure while they actually form the backbone of our economy.

Financial Education

Consciousness can have an advantage over Financial products, speculation and bonusesIn the past decades countless complicated and very risky financial products have been put on the market with the aim of making lots of money. Options, futures and other derivatives. Large banks and investment funds gamble on the insolvency of businesses and even countries.

It’s a well known fact that Goldman Sachs earned billions by speculating on, among others, Spain and Greece defaulting on their debts. It’s in their interest to make sure that it happens. How can we ethically justify money being made on the downfall of a complete country, or even a whole continent with all the disastrous consequences?

In addition to this there is growing dissatisfaction over the bonuses of directors and other managers, especially those in the financial world. These bonuses are out of all proportion and are even paid out for in case of managerial failure. Not one year after the financial crisis, which was set in motion by ethically irresponsible business practices by bankers, these same bankers rewarded themselves richly again. Either directly with bonuses, or by transforming a part of the bonus into normal basic salary. In any case it’s never justifiable that people earn huge sums on the downfall of others.

Bernard Madoff was convicted to 150 years prison for setting up a pyramid scheme. However, the whole financial world is one big pyramid scheme. What punishment will we give the system? Or will we do nothing?

SME enterprises, key generators of employment, income, innovation and growthWhen a crisis hits, it’s SME‘s that quickly come under pressure. Loss of turnover is proof of that. Because of the relatively small size is diversification usually not an option. In other words, it’s not likely that SME’s can switch to products or services that do better under the circumstances. SME’s are also, because of their small size, less able to downsize. For example, they can’t dispose of a loss making division, or cease activities in countries that don’t provide enough return like the larger multinationals can.

Still, the SME’s form the backbone of the economy in many countries. They also create a lot of employment. The Organization for Economic Co-operation and Development (OECD), in a report from 2009, said this about the role of SME’s: “SME businesses play an important part in all economies and are the key generators of work and income". In addition they are the driving force behind innovation and growth. In the countries affiliated with the OECD the SME’s are responsible for more than half of the employment in the private sector.

In the European Union 99 percent of all businesses fall under the SME. More than 90 percent of these businesses employ less than 10 people. SME businesses are, according to the OECD, essential for economic recovery. Nonetheless, the financial position of many SME’s is under pressure, because for their financing they are dependent on supplier- and bank credit. This form of financing are difficult to get access to. Government support is often aimed at guaranteeing or subsidizing long term investments, and especially for SME’s that can show a convincing plan and a realistic prognosis of the returns.

Government can do little for SME’s with decreasing turnover and consequently rising losses. Alas, these SME’s are much higher in number than those with good outlooks. In general, their weak position is not the consequence of mismanagement, as the banks would have us believe. The decrease in turnover is mostly caused by external factors like unemployment, a lower disposable income and the reductions in (semi)government spending. For many SME’s it’s a case of surviving and hoping that the crisis will be over quickly.

The IMF has apparently learned nothingThe realization that the whole financial and monetary system is unsustainable hasn’t yet dawned on most banks and financial organizations. Their interests aren’t served by such a realization. And certainly not for the IMF. The IMF has apparently learned nothing from the crisis in Argentina in the 90’s, when a similar situation emerged to that of the current crisis countries. Huge loans, coupled with demands that led to the break-up of the social, and inevitably also the ecological, structure of the country. The life expectancy of people in countries with debts to the IMF decreases on average by 5-10 years. This is because the austerity measures, that are implemented to pay for the extra debt, lead to lower wages in an inflationary surrounding. A poverty trap if there ever was one.

The ‘Icelandic’ solutionWhen the banking crisis, that pushed, or started to push, almost the whole world into a depression, reached Iceland, the Icelanders did something that nobody else did: they refused to pay for the gambling debts of the banks and they told the bond holders to be prepared for big losses. Iceland just went bankrupt and was ‘punished’ by being refused entry into the Euro-zone. After deciding to give the bankers and government, those responsible, a kick up the backside they made their way out of the hole on their own strength.

It worked miraculously and with the unique project of forming a new constitution fully under way the country has become a guiding light for other western economies that yet to have sorted out the debts made by their casino banks. As we said, the bill was presented to the bond holders, the currency was devalued by about 25% to improve exports and after seven quarters of economic downturn they achieved a growth of about 1,2% in the third quarter of 2010. That means that the country has beaten the recession without a single cent of emergency aid from the EU or the stranglehold of the IMF.

It’s a similar route to the one Argentina took when it went bankrupt almost ten years ago. The Argentines also refused a stranglehold contract with the IMF, pulled in foreign investors and in recent years have shown spectacular growth figures – even at the top of the credit crisis.

Now that the Argentinean way has seemed to work in Iceland as well, the current crisis countries will hopefully feel the need to start using their own (complementary) currency, show the IMF politely to the door, and to follow their own course. If it’s too late for Ireland, maybe Spain, Portugal, Italy and other countries that are on the edge of bankruptcy can follow the example of the Icelanders.

The Icelandic president Olafur R. Grímsson said: "The difference with other countries is that Iceland allowed its banks to fail. They were private banks and we have refused to pump money into them to keep them going. The state did not want to take responsibility for failing private banks."

The concealed loss of our pension fundsBy irresponsible, speculative investments many Dutch pension funds have invested in government bonds of countries in crisis. In 2013 the government bonds of many countries in crisis will be declared worthless. It has been announced. At least, European governments have decided that this is how they will solve the problem. Your pension will be used for the benefit and glory of smart politicians. The ministers of finance know it, and other European politicians as well. Say goodbye to your pension if you’re under 60 years old.

Within five, years the especially well filled pension funds of the Netherlands will be used as collateral for Greece, Ireland, Portugal, Belgium, Spain and other countries in crisis. Be assured that the collateral will be demanded. That is already calculated into the system. The current politicians will be gone by then, and their successors can clean up the mess. This is one of the main reasons that many of those involved are advising carrying on with the financing of the countries in crisis even though they are just money pits.

What do you think would happen if Dutch society knew the truth about their pensions? Nobody wants to have riots, so it’s better to solve the problem with resolute measures. Together, we can find solutions for, and reduce the damaging effects of the bad management of many pension funds. In this respect our specialized team can advise you and help to shelter society for the coming disaster. We can still change our course. It isn’t too late. It’s time for courage and truly tenacious action!